IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Event-Driven

<ul>
<li>A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.</li>
<li>ECM developments: <a href="https://www.smartkarma.com/entities/mmg-ltd" target="_blank" data-smartkarma-citation="entities:13961:1" rel="noopener">MMG (1208 HK)</a> US$1.2 billion rights issue. <a href="https://www.smartkarma.com/entities/shift-up-corp" target="_blank" data-smartkarma-citation="entities:36232:1" rel="noopener">Shift Up (462870 KS)</a> seeks to raise up to US$320 million.</li>
<li>Event-Driven developments: <a href="https://www.smartkarma.com/entities/asia-cement-china-holdings" target="_blank" data-smartkarma-citation="entities:3374:1" rel="noopener">Asia Cement China (743 HK)</a>, <a href="https://www.smartkarma.com/entities/cpmc-holdings-ltd" target="_blank" data-smartkarma-citation="entities:10427:1" rel="noopener">CPMC Holdings (906 HK)</a>, <a href="https://www.smartkarma.com/entities/chilled-frozen-logistics-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:40987:1" rel="noopener">Chilled &amp; Frozen Logistics Holdings (9099 JP)</a>,  <a href="https://www.smartkarma.com/entities/nagatanien-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:8059:1" rel="noopener">Nagatanien Holdings (2899 JP)</a>, <a href="https://www.smartkarma.com/entities/teijin-ltd" target="_blank" data-smartkarma-citation="entities:5097:1" rel="noopener">Teijin Ltd (3401 JP)</a>, <a href="https://www.smartkarma.com/entities/altium-ltd" target="_blank" data-smartkarma-citation="entities:18626:1" rel="noopener">Altium Ltd (ALU AU)</a>. </li>
</ul>


A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
ECM developments: MMG (1208 HK) US$1.2 billion rights issue. Shift Up (462870 KS) seeks to raise up to US$320 million.
Event-Driven developments: Asia Cement China (743 HK), CPMC Holdings (906 HK), Chilled &amp; Frozen Logistics Holdings (9099 JP),  Nagatanien Holdings (2899 JP), Teijin Ltd (3401 JP), Altium Ltd (ALU AU). 


Weekly Deals Digest (09 Jun) - Teijin, Nagatanien, CF Logistics, Asia Cement, CPMC, MMG, Shift Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/blackstone-inc" target="_blank" data-smartkarma-citation="entities:27166:1" rel="noopener">Blackstone (BX US)</a> is widely reported to have agreed to acquire <a href="https://www.smartkarma.com/entities/teijin-ltd" target="_blank" data-smartkarma-citation="entities:5097:1" rel="noopener">Teijin Ltd (3401 JP)</a>’s 55% stake in <a href="https://www.smartkarma.com/entities/infocom-corp" target="_blank" data-smartkarma-citation="entities:8412:1" rel="noopener">Infocom Corp (4348 JP)</a> at a valuation of JPY260 billion. </li>
<li>If the valuation refers to market cap and Teijin shares its tax benefits, Teijin's sale proceeds are around JPY128 billion, which is 42% of its market cap.</li>
<li>However, since 9 May, Teijin shares have been flat vs. Infocom shares are up 63%. Teijin's medium-term plan suggests that the Infocom proceeds could result in substantial share buybacks.</li>
</ul>



Blackstone (BX US) is widely reported to have agreed to acquire Teijin Ltd (3401 JP)’s 55% stake in Infocom Corp (4348 JP) at a valuation of JPY260 billion. 
If the valuation refers to market cap and Teijin shares its tax benefits, Teijin's sale proceeds are around JPY128 billion, which is 42% of its market cap.
However, since 9 May, Teijin shares have been flat vs. Infocom shares are up 63%. Teijin's medium-term plan suggests that the Infocom proceeds could result in substantial share buybacks.


Teijin (3401 JP): Alternative Play on the Potential Infocom Tender

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>15 weeks ago, a specialised media outlet suggested <a href="https://www.smartkarma.com/entities/teijin-ltd" target="_blank" data-smartkarma-citation="entities:5097:1" rel="noopener">Teijin Ltd (3401 JP)</a> was in process to sell its stake in <a href="https://www.smartkarma.com/entities/infocom-corp" target="_blank" data-smartkarma-citation="entities:8412:1" rel="noopener">Infocom Corp (4348 JP)</a>. </li>
<li>I caught up later, after the stock had run up significantly, but writing bullishly <a href="https://www.smartkarma.com/insights/infocom-4348-jp-the-meaning-of-binding-bids-and-250bn" target="_blank" rel="noopener">here</a> and <a href="https://www.smartkarma.com/insights/infocom-4348-jp-reports-of-an-exclusive-negotiation-may-give-hints" target="_blank" rel="noopener">here</a>. Since then, the stock is up another 33-35%.</li>
<li>Today we finally got the announced deal. Blackstone will buy the stock at a valuation of ¥280bn, paying ¥6,060/share for the minority stake, and buying back Teijin's stake at ¥4,340/share.</li>
</ul>


15 weeks ago, a specialised media outlet suggested Teijin Ltd (3401 JP) was in process to sell its stake in Infocom Corp (4348 JP). 
I caught up later, after the stock had run up significantly, but writing bullishly here and here. Since then, the stock is up another 33-35%.
Today we finally got the announced deal. Blackstone will buy the stock at a valuation of ¥280bn, paying ¥6,060/share for the minority stake, and buying back Teijin's stake at ¥4,340/share.


Blackstone Does a BIG Deal for Infocom (4348) - Minorities Get ¥6,060/Share

Japanese Equity Specialist, Ortus Advisors

Andrew Jackson

Japanese Equity Specialist

Ortus Advisors

Thematic (Sector/Industry)

<ul>
<li>US rebound lacks breadth, and while tech should be strong to start it may be too early to predict an extended rally off the lows in Japan after yesterday's gains.</li>
<li>An SMCI after-market miss is dulling the mood which may also dent sentiment for AI/SPE related to start.</li>
<li>A good print from CAT sets a positive tone for the likes of 6301 Komatsu and 6326 Kubota who were both sold heavily in the recent panic.</li>
</ul>


US rebound lacks breadth, and while tech should be strong to start it may be too early to predict an extended rally off the lows in Japan after yesterday's gains.
An SMCI after-market miss is dulling the mood which may also dent sentiment for AI/SPE related to start.
A good print from CAT sets a positive tone for the likes of 6301 Komatsu and 6326 Kubota who were both sold heavily in the recent panic.


Japan Morning Connection: 6301 JP, 6326 JP, 2503 JP

<ul>
<li>
<a href="https://www.smartkarma.com/entities/descente-ltd" target="_blank" data-smartkarma-citation="entities:8225:1" rel="noopener">Descente Ltd (8114 JP)</a> has recommended a pre-conditional tender offer from <a href="https://www.smartkarma.com/entities/itochu-corp" target="_blank" data-smartkarma-citation="entities:18448:1" rel="noopener">Itochu Corp (8001 JP)</a> at JPY4,350, 16.6% premium to the undisturbed price. </li>
<li>The pre-condition is approval under the competition laws of Japan and China. The offer is anticipated to commence in early November. In January 2019, Itochu completed a hostile partial offer.</li>
<li>While the offer is attractive vs peer multiples, it is light vs historical trading ranges. Securing the required acceptance rate could prove challenging as the price is light. </li>
</ul>



Descente Ltd (8114 JP) has recommended a pre-conditional tender offer from Itochu Corp (8001 JP) at JPY4,350, 16.6% premium to the undisturbed price. 
The pre-condition is approval under the competition laws of Japan and China. The offer is anticipated to commence in early November. In January 2019, Itochu completed a hostile partial offer.
While the offer is attractive vs peer multiples, it is light vs historical trading ranges. Securing the required acceptance rate could prove challenging as the price is light. 


Descente (8114 JP): Itochu’s (8001 JP) Light Pre-Conditional Offer

Japan

Teijin Ltd manufactures polyester and other fibers including nylon, acetate, aramid, and polyvinyl chloride for apparel and industrial materials.  Teijin also makes polyester films used in advanced magnetic media and electronics equipment through a joint venture with Dupont.  The Company also produces pharmaceuticals, medical products, and information system equipment.

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Teijin Ltd (3401 JP)

Weekly Deals Digest (09 Jun) - Teijin, Nagatanien, CF Logistics, Asia Cement, CPMC, MMG, Shift Up

Last week, notable developments occurred in Event-Driven (Asia Cement China, CPMC, CF Logistics, Nagatanien, Teijin, Altium, APM) and ECM (MMG,...

Arun George

Teijin (3401 JP): Alternative Play on the Potential Infocom Tender

Since 9 May, Teijin shares have been flat, while Infocom shares are up 63%. Teijin's medium-term plan suggests that the Infocom proceeds could...

Arun George

Japan Morning Connection: 6301 JP, 6326 JP, 2503 JP

US rebound lacks breadth, tech may be strong but early to predict extended rally in Japan. SMCI after-market miss may dent sentiment, CAT's good...

Andrew Jackson

Descente (8114 JP): Itochu’s (8001 JP) Light Pre-Conditional Offer

Securing the required acceptance rate could prove challenging as the offer price is light. There is a reasonable chance the shares will trade above...

Arun George

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Weekly Deals Digest (09 Jun) - Teijin, Nagatanien, CF Logistics, Asia Cement, CPMC, MMG, Shift Up

Last week, notable developments occurred in Event-Driven (Asia Cement China, CPMC, CF Logistics, Nagatanien, Teijin, Altium, APM) and ECM (MMG,...

Arun George

Teijin (3401 JP): Alternative Play on the Potential Infocom Tender

Since 9 May, Teijin shares have been flat, while Infocom shares are up 63%. Teijin's medium-term plan suggests that the Infocom proceeds could...

Arun George

Blackstone Does a BIG Deal for Infocom (4348) - Minorities Get ¥6,060/Share

The Blackstone deal for Infocom (4348) has been announced. +177% vs undisturbed for minorities and interestingly, the combined price for Blackstone...

Travis Lundy

Japan Morning Connection: 6301 JP, 6326 JP, 2503 JP

​US rebound lacks breadth, tech may be strong but early to predict extended rally in Japan. SMCI after-market miss may dent sentiment, CAT's good...

Andrew Jackson

Descente (8114 JP): Itochu’s (8001 JP) Light Pre-Conditional Offer

Securing the required acceptance rate could prove challenging as the offer price is light. There is a reasonable chance the shares will trade above...

Arun George

US rebound lacks breadth, tech may be strong but early to predict extended rally in Japan. SMCI after-market miss may dent sentiment, CAT's good...